Since the announcement of the new American law called the “Inflation Reduction Act” (IRA) of 2022, Europeans seem to be experiencing continuous headaches. Senior EU officials have all expressed, in their own nuances, their fears of the negative impact that the law in question would have on the industrial competitiveness of EU countries in what is agreed to be call Green Industry. Indeed, the American law grants, among other things, tax benefits to manufacturers who locally produce electric vehicles that they equip with batteries made in the USA. The EU countries consider that the net effect of this law would be to globally suck investments, and skills, in this sector of the future towards the United States to the detriment of EU competitiveness. This is currently resulting – Under the impetus of the French President, Mr. Emmanuel Macron – like a commotion led by Thierry Breton, European Commissioner in charge of the internal market and industrial policy, to push the EU authorities, which are very receptive, to implement reciprocal regulations to the above-mentioned American ones to prevent a supposed flight of capital and skills to America. As presented by European officials, this issue defines the EU as the champion of any category of innovation for Green Industry, while America, which would be jealous of the EU, would like to steal this privilege by dangling subsidies and tax benefits to lure major European skills, including manufacturers.
Obviously, it may be tempting to sympathize with the official European thesis mentioned above to consider the United States as a bad player who would dangle advantages of all kinds to attract EU industrial skills on its soil. In reality, nothing has been done yet and the mood swings of Europeans for the moment are not very convincing.
First, the Europeans offer no evidence that shows the US really needs EU capital or skills to advance their green industry projects.
Then, assuming (only) that the Americans have the idea of attracting European skills to the US market, the frown that the Europeans seem to show is more hypocritical than anything else. They themselves have always applied this practice to encourage our African skills to emigrate for the benefit of the EU to the detriment of Africa. So either the EU countries don’t know what they are talking about, which would be surprising, or, more likely, the reasons for their uneasiness lie elsewhere.
In this respect, last November, the French ambassador in Beijing openly criticized – contrary to the duty of reserve required of this type of function – the “Chinese policy of dynamic zero Covid” which “has repercussions on French companies present in China”. France seems to be the only European country to have distinguished itself by this declaration. Indeed, if China had breached the WTO rules, it was the EU Commission that should have stepped up, which was not the case.
Now, for grievances about the “Inflation Reduction Act”, another spokesperson for Mr. Emmanuel Macron, namely Mr. Thierry Breton mentioned above, is leading the charge, this time against the United States. This should suggest that French industry would be more negatively impacted by this law than other EU countries. However, according to an article of last January 13, Der Spiegel indicates that France is less industrialized than other EU countries and therefore less dependent on export markets. If so, and there is no reason to doubt Der Spiegel‘s assertion, why within the EU France is the country most vocal about the United States on ” Inflation Reduction Act” and on China regarding the “Zero Covid” policy. It is obviously not possible for us to know exactly. But the exacerbated attitude of France vis-à-vis China could have different motives from the grievances it would have vis-à-vis the USA. Indeed, while Germany has become much attached to the Chinese market first and foremost because it sells its cars and industrial equipment there; France does not export much industrial material there. The problem is that the Chinese strategy to enforce the “Zero Covid” doctrine has drastically reduced the movement of foreigners within the Chinese market. It is then assumed that French commercial operators have become accustomed to the flexibility of going where they want in China to, among other things, order all sorts of items likely to be refitted for a “Made in Europe” to be sold on our continent with juicy capital gains. The tightening of the conditions for the movement of foreigners within China will have constituted a brake on this commercial practice of a particularly lucrative and risk-free speculative nature.
But this hypothesis does not explain the rage of French officials on the American law of “Inflation Reduction Act“. Indeed, French exports of industrial products to the American market are, unlike Germany, far from being significant in explaining the exasperated reactions of French officials against this American law on the reduction of inflation. So, perhaps the goal of senior French officials is more to be heard in Africa than in America and Europe where American and European citizens know what to expect from France.
The truth is that France’s task – to maintain its place as the leading economic and commercial partner of more than a third of African countries with the role assigned to the CFA franc and thus embellish its role as a “great power” within the Security Council of the United Nations — is becoming less simple day by day.
While our continent is now coveted by everyone, it was easier for France to defend its positions against China and Russia by arguing the lack of respect for democratic principles or human rights. But now that Joe Biden is showing America’s interest in coming to Africa, the arguments will be harder to come by. The “Inflation Reduction Act” will have provided a good pretext to stand up, without appearing to do so, against the USA and kill two birds with one stone: To appear as a European leader in the eyes of French public opinion – in front of which Mr. Macron has been harshly judged lately – and at the same time leave the impression to Africans in general, and to a Morocco which is distancing itself in particular, that France is of a size to measure up to the greatest of this world.
In reality, the problem of our time today can be summed up in the fact that the rules that articulate our current world were established almost 80 years ago and have had their day. And when something has had its day, we go back to the source to establish new rules. But our industrial world has its source in the discovery of energy resources, coal and oil in the first place. But, in the absence of duly established know-how to properly exploit these resources, our predecessors had to work hard to define ways to develop them. Today, the data to value anything is available, accessible and varied. The entry into play of our African countries which have great resources will change the face of the world in general and Africa in particular. Indeed, we have on our continent many Raw Materials, agri-food and others, which are just waiting to be valued by existing methods and techniques that are available and accessible.
Africa is able to recover to turn the page of the miseries of colonization definitively and become an actor that counts in this new world as long as Africans agree to free themselves from the yoke of postcolonial propaganda.